Intercellular signaling is required to specify cell identity during the development of many organisms. Several molecules used as patterning signals have been identified by genetic analysis in Drosophila, and their homologs have subsequently been found to act similarly in vertebrate development. One such molecule is the product of the wingless (wg) gene, which is required for the development of many different tissues; homologous Wnt molecules are likewise important signals in vertebrate development, and their inappropriate activation can lead to oncogenesis. While some components of the intracellular response to secreted wg and Wnt proteins have been identified, the pathway is not fully understood. Mutations in the eyelid (eld) gene cause phenotypes opposite to those of wg mutations in the Drosophila eye, wing and embryo, suggesting that one of the functions of eld is to antagonize wg activity eld encode a proline-rich nuclear protein with homology to a family of novel DNA- binding domains. The aim of this proposal is to determine the function of the eld protein using biochemical and genetic methods. We will test whether eld is able to bind DNA as predicted, determine its consensus binding site, and study its effect on transcription. We will also look for proteins interacting with eld in a yeast two-hybrid system, which requires no assumptions about the function of the protein. To test whether eld responds to wg signaling, we will determine whether the protein is post- transcriptionally modified in response to wg in response to wg in embryos or cultured cells, and if so, whether this affects its activity as a transcription factor. Finally, we will test our models in vivo by making mutant versions of the eld protein designed to have altered activities, and reintroducing them into file to look for rescue or dominant effects. The results of these studies will lead to a clearer understanding of how eld contributes to normal pattern formation, and whether it could be a nuclear effector of wg.